Miner’s socio-environmental failings under the spotlight

Platinum group defends its efforts as study berates its employment policy and housing shortcomings, writes Sue Blaine

IT IS easy to kick a man when he is down, and as much as global platinum giant Lonmin may deserve some of the public opprobrium it has suffered since 34 of its striking miners were killed by police in August last year, it has become the whipping boy for the whole industry.

Church-based nongovernmental organisation Bench Marks Foundation executive director John Capel says Lonmin has itself admitted it failed to meet its own socioeconomic and environmental goals. Lonmin is one of the world’s largest producers of platinum group metals and is listed on both the JSE and the London Stock Exchange.

“If the relationship between mining houses and the government was honest, the government ... would not hesitate to take away their licences,” Mr Capel says.

But Cadiz Corporate Solutions mining specialist Peter Major says it is easy for lobby groups to “score brownie points” off Lonmin, or any other mining company, because they are “perceived as allpowerful”, although mining companies are “just a shadow of what they were 20-40 years ago”.

“There are big kudos in that,” he says.

Mr Capel, who yesterday presented a Bench Marks study on Lonmin’s social and environmental goals, said the company was “a case study that reflects what the mining industry is doing (in SA)”. The study was undertaken after Lonmin said its sustainable development reports were a rebuttal to a previous, damning, report by Bench Marks on the platinum mining industry’s social and environmental performance in the North West province’s Bonjalo district.

Among others, Bench Marks yesterday berated Lonmin for increasing its employment of contract workers from “20% to 25%” to 30% when the global financial crisis struck in 2008, “causing strain on the existing communities and its (sic) various resources”; paying contract workers on average 60% less than fulltime employees.

It also committed to building 6,000 houses for employees by 2011, then changed that goal to 5,500 houses by 2014; promised to convert hostels to bachelor and family units by 2011, then moved the deadline to 2014; and was criticised for using “hundreds of subcontractor firms”.

Lonmin executive vice-president in charge of sustainability, Natascha Viljoen, says the group was reviewing “requirements to create sustainable communities”; the viability of alternative shift and leave patterns, and “how to work with labour and industry” to better use infrastructure and invested capital.

The miner was considering an employee share option plan, and greater use of small and mediumsize enterprises from the greater community. The ratio of employees to contractors was 3:1.

The company was also looking at cleaner technology that would reduce its sulphur dioxide emissions, and it reported unplanned discharges to the Department of Water Affairs, working with it to minimise damage.

Mr Major says: “If you want to take a glass half-full attitude, you will find a lot of improvements. (Mining companies) have a lot of plans, and yes, they are behind (in reaching their goals), but executing those plans takes money and time and they are continually harassed. In the past, no one knew who the managers of mining com- panies were; now we do. We have gone from a society that values results to one that values media time and attention.”

World Wide Fund for Nature SA Living Planet Unit chief Saliem Fakir says Lonmin’s new CEO, Ben Magara, was attempting to review the group’s “long-term role in the socio-environmental context” and also to get the company up and running. Mr Magara took over on July 1.

Listed companies put in more effort on sustainability because they are continually measured by analysts, Mr Fakir says.

Lonmin is listed on the JSE’s 2012 socially responsible index, although the JSE last year downgraded Lonmin and five other mining companies from “best performer” expressly because of labour unrest in the sector.

Centre for Environmental Rights executive director Melissa Fourie says: “The problem with mining in SA, from an environmental point of view, is principally the absence of a strong and proactive regulator that makes proper decisions regarding the appropriate location of mining activities.”